Alkem Laboratories (ALKEM) Q4 19/20 earnings summary

Executive summary

• FY20 revenue from operations rose 13.4% YoY to ₹83,443.6 million; growth was broad-based across India, the US and other international markets.

• EBITDA increased 32.2% to ₹14,734 million and consolidated PAT attributable to owners rose 48.2% to ₹11,270.7 million, supported by cost optimisation, process improvements and a lower effective tax rate.

• Operations remained active through the pandemic, with essential-medicine supply maintained; management expected no significant impact based on its assessment at the time, while noting uncertainty could change conditions.

Financial highlights

• Consolidated revenue from operations was ₹83,443.6 million versus ₹73,571.9 million in FY19; PBT was ₹12,597.9 million versus ₹9,546.6 million.

• EBITDA margin expanded 250 bps to 17.7% from 15.2%; gross margin was 59.9% versus 60.0%.

• Consolidated PAT was ₹11,493.1 million; PAT attributable to owners was ₹11,270.7 million, up 48.2% YoY; EPS was ₹94.26 versus ₹63.61.

• Standalone revenue from operations increased 16.9% to ₹66,770.8 million; standalone PAT rose 58% to ₹12,644.2 million.

Outlook and guidance

• Domestic outlook remained positive over the medium to long term, with expected market growth supported by chronic disease prevalence, affordability and wider healthcare access; lockdowns and deferred visits weighed on near-term prescriptions.

• US growth priorities include complex generics, a steady ANDA pipeline, timely launches, in-licensing and partnerships amid pricing pressure and customer consolidation.

• First biosimilar launch in India from Enzene’s own R&D and manufacturing facility was planned for FY21; Enzene had secured European and US clients for clinical-material projects.